nasscom ilf 2016: attacking the digital disruptor
TRANSCRIPT
Attacking the Digital DisruptorsMohan SawhneyMcCormick Foundation Professor of TechnologyKellogg School of Management
1.What?
2.So What?
3.Now What?
3 Questions
Causes of Digital Disruption
Disruptor Strategies and Business Models
Dealing with Digital Disruption
Outline
We are entering a world where people, information, things and infrastructure will be connected via a broadband network, transforming work, life and business.
Connectivity Causes Disruption
The Evolution of Hyperconnectivity
Internet
of
Things
• 100 billion devices
Mobile
Internet
• 10 billion subscribers
Desktop
Internet
• 1 billion users
The Internet of Things is Already Here
Connected Fitness
The seamless connection of equipment, sensors, applications and devices to provide an interactive and personalized experience for consumers and improved efficiency and profitability for facility operators.
Connected Fitness
Wearables in clothingMuscle Effort SensorsBio Sensing Bra
Connected Fitness and Self-Quantification
The world of logging apps and sensor-enabled devices is entering the mainstream, enabling the quantification and the pursuit of well-being for everyone.
The integration of mobile technology, computing devices, and emerging delivery system capabilities into a patient-centered model of care.• Patient-centered personal health
management.• Typically includes a device or
smartphone application.• PHR and EHR integration is possible.• Particularly beneficial for conditions
where continual tracking is warranted, such as Diabetes, Asthma/COPD, Aging in Place, Medication Adherence.
Connected Health
Link glucose meter readings to patient records electronically.
This link ensures that readings are recorded correctly and allows for physicians to passively monitor a patient’s blood glucose.
Pilot studies show that this kind of application is correlated to a reduction of 5 points in blood glucose readings and a 1% reduction in HbA1c readings over a three-month period.
Example: Diabetes Monitoring
But this is just the beginning….
Wearables Smart Cars Smart Homes Smart Cities Vertical Applications
Causes of Digital Disruption
Disruptor Strategies and Business Models
Dealing with Digital Disruption
Outline
Types of Value in Digital Disruption
Economic Value• Price transparency• Usage-based pricing• Reverse auctions• Demand aggregation
Platform Value• Marketplaces• Crowdsourcing• Sharing economy• Peer-to-Peer
Experience Value• Personalization• Convenience• Automation• Immediacy
Digital Disruptor Value Proposition
Digital Distuptor Value Proposition
Choice
Cost
Convenience
Control
Customization
Community
Digital Disruption StrategiesSupply
Disruption
Business Model
Disruption
Channel Disruption
Price Disruption
Experience Disruption
Assessing Vulnerability: The Digital Vortex
Source: Global Center for Digital Business Transformation, IMD
Types of Digital Disruptors1. Disruptive Digital Startups2. Products as Software3. Innovative Incumbents4. Channel Disintermediators
1. Disruptive Entrants: UberQuestions Uber addressed:• Where’s the nearest cab?• How long do I have to wait?• Who is the driver?• What kind of car is it?• How much will it cost?• Do they take credit cards?• How much should I tip?• Can I split the cab fare?• Can I contact the driver?
2. Products as Software: Tesla
• Car as connected appliance• App to control the car• Over the Air software updates• Future-proof Hardware
3. Innovative Incumbents
4. Channel Disintermediators
Causes of Digital Disruption
Disruptor Strategies and Business Models
Dealing with Digital Disruption
Outline
4 Strategies to Deal with Digital Disruption
• Disrupt the Digital Disruptor
• Acquire a Digital Disruptor
• Integrate Digital with Physical• Think Like a Disruptor
Attack Acquire
AbsorbAdapt
Attack digital disruptors by creating a digital disruptor of your own
Leverage your assets and brand to create a model disruptors cannot copy
Compete asymmetrically using a Judo strategy
1. Attack - Disrupt your own business
Attack: HBO Fights Back!
HBO Streaming Service
2. Acquire: Keep Cannibals in the Family
+
Steps in Organizational Integration
Isolate Incubate
Infiltrate Integrate
Create a consistent web, mobile and social media experience
Leverage social media for in-store sales promotions
Link online commerce with retail stores
Design digitally enhanced physical brand experiences
3. Absorb: Integrate Digital with Physical
Designing Hybrid Experiences: Burberry• Brings digital world to life in
a physical space• Customers experience the
brand through immersive multimedia content like they do online
• RFID technology provides audio-visual content on selected items carrying microchips.
• Sales assistants use iPads to keep a log of purchase history and customer preferences.
Leveraging Social Media in the Store
Consistent Digital Experience: Nasty Gal
Digital customer strategies – Provide customers with an omnichannel customer experience, where they can choose how to engage at any time on any device. The channels must be integrated and contextual, with the ability to proactively engage on behalf of the consumer.
Digital enterprise strategies – Evolve the business processes to become a digital customer-first enterprise, with digital customer-facing processes, digital collaboration tools and a digital culture.
Digital operational strategies – Embrace technology that supports digital transformation. This includes an open architecture that allows the enterprise to integrate with third parties that may have different architectures running differently.
Becoming Digital
Question assumptions Embrace agile processes Build marketing into your products Leverage privileged assets Think big, start small, scale fast
4. Adapt: Learn from Digital Disruptors
The Agile Enterprise
Leadership – Change Mgmt.
Adapt or Die
It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change.
- Charles Darwin
Thank you!